Minors can…
Minors can be agents
3 parties who are all considered agents
1 partners
2 corporate officers
3 employees
Agency requires…2
1 requires meeting of the minds
2 does not require consideration
Power of attorney
Written authorization of agency
Power of attorney need only…2
1 Need only be signed by principal
2 not agent
With power of attorney the agent does…
Does not have to be an attorney at law
Power of attorney usually limits…
Limits agent’s authority to specific transactions
2 agencies that require writing
1 agencies to buy land
2 agencies impossible to perform in 1 year
Most agencies are terminable…
Are terminable at will
Most agencies are terminable at will, but if you breach a contract…
You must pay damages
Termination by law: following 4 terminate agency immediately
1 death or insanity of either party
2 bankruptcy of principal
3 loss or destruction of essential subject to agency
4 failure to have or loss of a required license
Bankruptcy of an agent…
Does not end the agency
Agency coupled with an interest 2
1 P makes A an agent
2 solely to pay debt P owes to A
Under, Agency coupled with an interest, how is it terminated?
P cannot terminate this agency, only A can
Death or insanity does not end…
Agency coupled with an interest
Termination of Agency:
If A is terminated, P must…2
1 give actual notice to old customers and
2 publish notice to new ones
2 types of authority
1 real authority
2 actual authority
Real or actual authority may be…
Express or implied
Express authority
P tells A he’s authorized
Implied authority
Authority necessary to do assigned tasks
Apparent authority or agency by estoppels
A appears authorized (was it reasonable to believe A was authorized)
Liability for contracts:
P is liable for…
all authorized contracts made by A on his behalf
P is not authorized for unauthorized contracts unless…
P ratifies
3 requirements for P to ratify
1 P must know all material facts to ratify
2 if P accepts the benefits of the deal he’s ratified
3 for P to ratify, A must indicate he was making contract on behalf
Of P
Once P ratifies…
3rd parties are stuck with the deal
A is liable for…
All unauthorized contracts
A is not liable for…
Authorized deals unless acting for an undisclosed principal
Undisclosed principal
A makes contract in his own name while really acting for a secret
P
Undisclosed principal:
Actual authority of A
2) Apparent authority of A
A has same actual authority as agent for disclosed principal
2) A cannot have apparent authority
Undisclosed principal:
If there is a breach…
Both P and A are liable
3rd party cannot…
Cannot get out of a deal because of undisclosed P
Respondent Superior
Liability for Torts
Liability for Torts:
P is responsible for…
All torts committed by A while acting in scope of agency
Liability of Torts:
P isn’t liable for…
Isn’t liable for torts of independent contractors
P isn’t liable for torts of independent contractors
Not subject to the same control
Liability of Torts:
P is liable even if…
Agent’s tort was flagrant disregard of instructions
Liability of Torts:
A is liable for the tort even if…
Committed at P’s direction or order
Liability of Torts:
Employees injured in scope of employment…
Collect Worker’s comp even if negligent
Duties of Principal and Agent:
P owes the following duties to A, what is the neumonic?
ICE
Duties of Principal and Agent:
P owes the following duties to A, what does ICE stand for?
1 Indemnify
2 Compensate
3 Expenses
Duties of Principal and Agent: P owes the following duties to A
I
Duty to Indemnify A for losses incurred while acting for P
Duties of Principal and Agent: P owes the following duties to A
C
Duty to Compensate A (Must keep records)
Duties of Principal and Agent: P owes the following duties to A
E
Duty to reimburse A for Expenses
Duties of Principal and Agent:
A owes the following duties to P, what is the neumonic?
DIAL-O
Duties of Principal and Agent: A owes the following duties to P
What does DIAL-O stand for?
1 Due care 2 Inform 3 Account 4 Loyalty 5 Obedience
Duties of Principal and Agent: A owes the following duties to P (DIAL-O):
D
Duty of Due care
Duties of Principal and Agent: A owes the following duties to P (DIAL-O):
I
Duty to Inform P of all relevant facts
Duties of Principal and Agent: A owes the following duties to P (DIAL-O):
A
Duty to Account for money received or spent (must keep records)
Duties of Principal and Agent: A owes the following duties to P (DIAL-O):
L
Fiduciary duty of Loyalty- must act solely in P’s best interest
Duties of Principal and Agent: A owes the following duties to P (DIAL-O):
O
Duty of Obedience, must follow P’s reasonable instructions
Agent
Anyone authorized to act on behalf of another